The benefits of recession

04 March 2010

The recession has been a win-win for digital advertising. It has driven brands and consumers online more quickly and locked both into a long term conversation faster than would otherwise have been the case.

It has precipitated the creation of an environment that requires creative, planning and distribution expertise to make sure brands are actively and positively included in these conversations. It was going to happen anyway, but the recession has made the transition to a world where marketing is two-way and accountable faster.

The real impact of the recession, however, has been on social media. Its usefulness in helping to stay connected with friends, family and contacts has made the quest for new jobs and for cheaper products and services far simpler and more effective.

The result is that the growth of social networking has continued at breathtaking pace with communities springing up and bringing together groups of like minded individuals from across the globe. These groups are having a profound effect on brands whose products and services they openly debate.

Online comments from consumers are now used by roughly half of all consumers to make a purchase and are rated as three times more influential as traditional advertising, such as TV.

So why is this great news for digital advertising?

The news headlines are littered with examples of brands being savaged by customers for not delivering the level of product or service expected. But, as we all know, its only bad news that makes headlines. Others, like Harley Davidson, Ikea and HTC, to name just three, have successfully used the internet to drive strong sales and to build stronger relationships with customers.

They have managed to do this because they have understood that marketing success in the 21^st century requires much more than creating great content. To achieve real cut through and success the planning, distribution and reporting of campaigns has become critical. In the vast expanse of the internet, knowing where that content should go is just as important as having great content.

The result is that we are all being pushed to raise our standards. Formulaic creative just won’t cut it. Anyone, who’s seen the Dr Pepper attempt at a flash mob at the New York Stock Exchange, will cringe at this lazy attempt to copy T Mobile. So, creatives are under greater pressure to deliver better work.

Marketing managers have already been shifting advertising budgets from traditional media to digital because they value the advanced targeting they get with online. Online already delivers better measurability, track ability and, therefore, accountability and has been another main reason for online’s gains during recession.

More needs to be done of course and reporting and accountability will be big buzz words for 2010. I expect a raft of interesting new digital tools to be launched soon, including major advancements in predictive models and behavioural targeting. 

For brands and agencies in digital marketing who are good at what they do, the recession has helped lay the foundations for a successful decade ahead.

Jimmy Maymann, chairman, goviral